James Villa Holidays Limited v Crabtree
[2022] WASC 428
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS
CITATION: JAMES VILLA HOLIDAYS LIMITED -v- CRABTREE [2022] WASC 428
CORAM: MASTER SANDERSON
HEARD: 13 APRIL 2022 & ON THE PAPERS
DELIVERED : 13 DECEMBER 2022
PUBLISHED : 13 DECEMBER 2022
FILE NO/S: FRJ 1 of 2018
BETWEEN: JAMES VILLA HOLIDAYS LIMITED
Applicant
AND
GARY CRABTREE
First Respondent
JO-LEE CRABTREE
Second Respondent
AVANTEOS INVESTMENTS LIMITED as trustee for THE SYMETRY PERSONAL RETIREMENT FUND
Third Party
Catchwords:
Superannuation - Whether debt appropriation order can operate against funds due to party when superannuation payment made
Legislation:
Civil Judgments Enforcements Act 2004 (WA) s 52(1)(c) and s 103(1)(b)
Judgments Act 1838 (UK)
Senior Courts Act 1981 (UK)
Service and Execution of Process Act 1992 (Cth) s 105(4) and s 106(1)(b)
Superannuation Industry (Supervision) Act 1993 (Cth) s 62
Superannuation Industry (Supervision) Regulations 1994 (Cth) reg 6.17 and sch 1
Result:
Debt appropriation order set aside
Category: A
Representation:
Counsel:
| Applicant | : | G J Pynt |
| First Respondent | : | No appearance |
| Second Respondent | : | No appearance |
| Third Party | : | D A Lenhoff |
Solicitors:
| Applicant | : | McCabes |
| First Respondent | : | In Person |
| Second Respondent | : | In Person |
| Third Party | : | Turks Legal |
Case(s) referred to in decision(s):
Nil
MASTER SANDERSON:
This action was commenced by originating motion which sought to have a foreign judgment registered in this court. The grounds of the application, as set out in the originating motion, were as follows:
1.On 26 June 2017 a judgment was entered in the High Court of Justice Queen's Bench Division Bristol District Registry in favour of the Applicant against the Respondents in the sum of £118,809.78 for damages together with interest for £7,773.83 and costs of £10,000.00.
2.The reasonable costs of and incidental to registration including the cost of obtaining a certified copy of the judgment is $3,339.00.
3.Interest is claimed on the judgment from the date of entry of judgment being 26 June 2017 to the date of the Application pursuant to section 17 of the Judgments Act 1838 at the rate of 8 pounds per centum per annum totalling £7,365.24.
On 1 November 2018 I made the following orders:
1.The judgment dated the 26 day of June 2017 of the High Court of Justice Queen's Bench Division Bristol District Registry where it was adjudged that the abovenamed of Gary Crabtree and Jo-Lee Crabtree do pay to the abovenamed of James Villa Holidays Limited the sum of 126,583.61 (pounds sterling) and 10,000.00 for costs (pounds sterling) which together equal $AUD 260,506.5993 be registered as a judgment of this Court.
2.The Judgment Debtors be at liberty to apply to set aside registration of the judgment within 14 days after service on him/her of notice of registration if he/she has grounds for doing so and that execution upon the judgment shall not issue until after the expiration of that period or any extension of that period granted by the Court; or if an Application be made to set aside the registration, until the Application has been disposed of.
3.The costs of the Application and of registration of the judgment be taxed and added to the judgment as registered.
4.Judgment be registered for interest due under the judgment, from the date of entry of judgment being 26 June 2017 up to the time of registration, at the rate of 8% per annum pursuant to section 35A of the Senior Courts Act 1981 in the amount of $AUD 28,038.41
The applicant (judgment creditor) then took various steps to enforce the judgment. This involved a means inquiry, a property seizure and sale order and eventually a debt appropriation order. The third party then took out a chamber summons seeking orders cancelling the debt appropriation order. The chamber summons was in the following form:
1.The Debt Appropriation Order addressed to the Trustee for the Symetry Personal Retirement Fund dated 28 June 2021 ('DAO') be cancelled pursuant to s 103(1)(b) of the Civil Judgments Enforcement Act 2004 (WA).
2.Alternatively to paragraph 1 herein, the DAO be stayed pursuant to s 105(4) and 106(1)(b) of the Service and Execution of Process Act 1992 (Cth).
3.Alternatively to paragraphs 1 and 2 herein, there be a declaration that the DAO is void against the Third Party and is not required to be complied with.
4.Alternatively to paragraphs 1, 2 and 3 herein, the Third Party be granted an extension of time to object to the DAO pursuant to s 52(1)(c) of the Civil Judgments Enforcement Act 2004 (WA).
5.Enforcement of the DAO be stayed pending the determination of this application.
6.Such further or other relief as this Honourable Court may deem fit.
7.Costs of the application.
The application was supported by an affidavit of Samantha Tawil sworn 21 December 2021 and an affidavit of Rachel Lim affirmed 21 December 2021. The debt appropriation order was served on Avanteos Investments Ltd as trustee for The Symetry Personal Retirement Fund (Avanteos). Through a process which is not entirely clear, Avanteos was added as a third party to these proceedings. The third party filed submissions in support of the application to set aside the debt appropriation order.
Initially, the basis upon which it sought to set aside the order had to do with the bankruptcy of the first respondent (second judgment debtor) and second respondent (first judgment debtor). The second judgment debtor was made bankrupt in the Federal Circuit Court on 27 October 2016. On 13 January 2017, proceedings were commenced in the United Kingdom against both judgment debtors for damages for breach of contract. On 28 March 2017, the first judgment debtor became bankrupt. On 26 June 2017, judgment was obtained against both judgment debtors in the United Kingdom. It is this judgment which was the subject of the application for registration. The second judgment debtor was discharged from bankruptcy on 24 January 2020 and the first judgment debtor was discharged from bankruptcy on 29 March 2020.
It was the judgment debtor's position that by virtue of their bankruptcy, they were not liable to make payment to the judgment creditor. Initially this was the way in which the argument was framed. Submissions were filed on behalf of the judgment creditor and the judgment debtors which dealt with the issue in some detail. However, when the third party was joined to the proceedings another issue of rather more general importance was raised.
It was common ground the funds held by the third party are in the nature of superannuation payments. As such, the third party is subject to both the Superannuation Industry (Supervision) Act 1993 (Cth) (SIS Act) and the Superannuation Industry (Supervision) Regulations 1994 (Cth) (SIS Regulations). It is the third party's position that a superannuation fund and all contributions made into that fund are provided for the sole benefit of, or in relation to, members (or their dependants) after their retirement, on reaching retirement age or on their death. Reference is made to s 62 of the SIS Act and reg 6.17 and sch 1 of the SIS Regulations. The third party says it is prevented from making any payment pursuant to the debt appropriation order.
In response, the judgment creditor says it does not seek to have funds paid to it at present. Rather, it says the debt appropriation order should operate from the date on which the judgment debtors are entitled to payment from the superannuation fund. It is said what is achieved by service of the notice is a requirement that in the future, the third party make payment to the judgment creditor. Viewed in that way, it is submitted there is no breach of either the SIS Act or the SIS Regulations. It is only when funds are paid to the judgment debtors the debt appropriation order will bite.
Perhaps not surprisingly, there is no direct authority on this point. It also appears there is nothing in any comparable statute which might inform the position. It is a question then of looking at the intent of the SIS Act and the SIS Regulations to see whether allowing the debt appropriation order to stand is consistent with the policy of the Act.
On balance, I am not satisfied that is the case. What is made clear by the SIS Act and the SIS Regulations is that the superannuation asset of individuals is protected from their creditors. That is a position adopted by the legislature and which is made clear by the structure of the superannuation regime. To simply allow the issue of a debt appropriation order which will have an effect at some time in the future undermines the structure of the superannuation system. It would effectively mean that although superannuation assets of a debtor were not immediately available to satisfy a debt, they would be so available some time in the future. The immediate protection offered to superannuation assets would really be illusory. They would be stripped from the superannuant at a later date. All the interpretation contended for by the judgment creditor achieves is to delay the delivery up of the superannuation assets until the funds pass into the hands of the judgment debtor because the requirements of the SIS Act and the SIS Regulations which entitle the judgment debtor to payment of the superannuation funds have been satisfied.
In my view, the debt appropriation order ought be set aside. I will hear the parties as to the precise form of orders and as to costs.
I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
TM
Court Officer
13 DECEMBER 2022
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